The Euro Company Wants to Compare the Performance of Three

question 53

Multiple Choice

The Euro Company wants to compare the performance of three business units. All the business units produce the same product with similar output per month. The company uses a flexible budget to plan and control manufacturing overhead costs. Overhead costs are applied to products on the basis of direct labour-hours. The standard cost card shows that 5 direct labour-hours are required per unit of product. Phelps Company had the following budgeted and actual data for March: $\begin{array}{lll}&\text { Actual }&\text { Budgeted }\\ \text { Units produced } & 11,000 & 10,000 \\\text { Directlabour-hours } & 65,000 & 60,000 \\\text { Variable overhead costs } & £ 84,000 &£ 80,000 \\\text { Fiked overhead costs } & £ 44,000 &£ 40,000\end{array}$
$\text { *Represents the denom inator activity for the month. }$
German Business Unit
$\begin{array}{lll}&\text { Actual }&\text { Budgeted }\\ \text { Units produced } & 11,000 & 10,000 \\\text { Directlabour-hours } & 65,000 & 60,000 \\\text { Variable overhead costs } & £ 84,000 &£ 80,000 \\\text { Fiked overhead costs } & £ 44,000 &£ 40,000\end{array}$
$\text { *Represents the denom inator activity for the month. }$
French Business Unit
$\begin{array}{lll}&\text { Actual }&\text { Budgeted }\\ \text { Units produced } & 11,000 & 10,000 \\\text { Directlabour-hours } & 65,000 & 60,000 \\\text { Variable overhead costs } & £ 84,000 &£ 80,000 \\\text { Fiked overhead costs } & £ 44,000 &£ 40,000\end{array}$
$\text { *Represents the denom inator activity for the month. }$
-The fixed overhead budget variance for March for the German Business Unit is

• A)£4,000 favourable.
• B)£4,500 favourable.
• C)£5,000 favourable.
• D)£5,000 unfavourable.

Recognize the importance of sample size in the accuracy of estimators.

Distinguish between point and interval estimates.

Identify characteristics of good estimators: unbiasedness, consistency, and relative efficiency.

Define and differentiate between consistency and unbiasedness of estimators.

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Definitions:

Vasoconstriction

The narrowing of blood vessels, which increases blood pressure and reduces blood flow to certain areas.

Blood Temperature

The temperature of the blood in the body, which is maintained around 37°C (98.6°F) under normal conditions.

Sweat Production

The process of producing and secreting fluid from sweat glands in the skin, involved in temperature regulation and excretion.

Metabolic Rate

The rate at which the body expends energy in a given period, crucial for determining how much food energy is converted into heat and physical or cellular activities.